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CHAPTER 1 REVIEW

CHAPTER 1 REVIEW. TEST 22 Defining Accounting Terms Vocabulary 15 True/False 11 transactions. 1-3 APPLICATION PROBLEM. -300. -300 (expense). 325. 0. 375. 300. 200. 800. -150. -150 (withdrawal). 175. 375. 300. 200. 650. 0. +800 (revenue). +800. 200. 0. 975. 375. 300.

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CHAPTER 1 REVIEW

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  1. CHAPTER 1 REVIEW • TEST • 22 Defining Accounting Terms • Vocabulary • 15 True/False • 11 transactions LESSON 1-3

  2. 1-3 APPLICATION PROBLEM -300 -300 (expense) 325 0 375 300 200 800 -150 -150 (withdrawal) 175 375 300 200 650 0 +800 (revenue) +800 200 0 975 375 300 1,450 -100 -100 (expense) 875 0 375 300 200 1,350 +400 +400 (revenue) 875 400 375 300 200 1750 +650 (revenue) +650 400 375 300 200 2,400 1,525 -35 -35 (expense) 1,490 400 375 200 2,365 300 +300 -300 1,790 100 375 300 200 2,365

  3. Study Guide 1 Part 1 Review Homework: Finish pages: 1-4 (STUDY GUIDE) I will collect the study guide! Read pages: 14-18 Finish 1-3 Application Problem 1. D Accounting =Planning, recording, analyzing, and interpreting financial information. 10. P Owner’s Equity = The amount remaining after the value of all liabilities is subtracted from the value of all assets. 18. J Capital = The account used to summarize the owner’s equity in a business. 12. L Ethics = The principles of right and wrong that guide an individual in making decisions. 11. E Accounting Equation = An equation showing the relationship among assets, liabilities, and owner’s equity. 13. I Business Ethics = The use of ethics in making business decisions. 19. R Revenue = an increase in owner’s equity resulting from operation of a business. 3. F Accounting Records = Organized summaries of a business’s financial activities. 14. U Transactions = a business activity that changes assets, liabilities, or owner’s equity. 20. S Sale on Account = A sale for which cash will be received at a later date. 2. G Accounting System = A planned process for providing financial information that will be useful to management. 4. N Financial Statements = Financial reports that summarize the financial condition and operations of a business. 15. A account = A record summarizing all the information pertaining to a single item in the accounting equation. 5. T service business = a business that performs an activity for a fee 21. M Expense = A decrease in owner’s equity resulting from the operation of a business. 6. Q proprietorship = a business owned by one person. 16. C account Title = The name given to an account. 7. H Asset = Anything of value that is owned. 8. K equities = Financial rights to the assets of a business. 17. B Account Balance = The amount in an account. 9. O Liability = Amount owed by a business 22. V Withdrawals = Assets taken out of a business for the owner’s personal use.

  4. STUDY GUIDE 1 PART 2 1. True 2. True 3. True 4. True 5. False 6. False 7. False 8. True 9. False 10. False 11. True 12. False 13. True 14. True 15. True 16. False 17. False 18. True

  5. 1-4 MASTERY PROBLEM, tp.21 wp.14 -400 -400 (expense) 1,900 0 200 100 1,800 400 +500 (Investment) +500 2,400 0 200 100 1,800 900 -50 (expense) -50 0 2,350 200 100 1,800 850 +1,025 +1,025 (revenue) 3,375 0 200 100 1,800 1,875 +450 +450 3,375 0 650 100 2,250 1,875 1-4 Mastery Problem, p.21 w.p. 14 +730 +730 (revenue) 650 100 2,250 3,375 730 2,605 -660 -660(expense) 2,715 730 650 100 2,250 1,945 -150 +150 2,565 730 800 100 2,250 1,945 +400 -400 2,965 330 800 100 2,250 1,945 -1,500 -1,500 1,465 330 800 100 750 1,945 +100 -100 1,365 330 800 200 750 1,945 +1,230 (revenue) +1,230 2,595 330 800 200 750 3,175 -1,200 (withdrawal) -1,200 1,395 330 800 200 750 1,975

  6. 1-5 CHALLENGE PROBLEM, p.22, w.p. 15 2. a.The owner of a business can withdraw assets from that business for personal use because the assets belong to the owner through the business. However, the owner must be careful to leave enough cash in the business for daily operations. -400 (withdrawal) -400 8,552 1,748 1,085 615 3,145 8,855 +250 -250 (expense) 8,552 1,748 1,085 615 3,395 8,605 (This transaction does not affect Zachary’s Repair shop) 2. b. The owner may withdraw assets other than cash if the business does not have sufficient cash for the owner to withdraw or if the owner has a use for other assets owned by the business. 1,748 1,085 615 3,395 8,605 8,552 -120 -120 1,748 1,085 615 3,275 8,605 8,432

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